"The reasons [the stocks popped] are short term in nature and related to improvements in just a few steel companies, not the industry as a whole," said Gibbs, equity chief investment officer at S&P Capital IQ. "This is a one-time event and not a long-term growth story."
Steel stocks have been in a steady downtrend for much of the past year, with the SLX, the ETF that tracks the sector, down more than 45 percent in the last 52 weeks. And for technical analyst Ari Wald, the charts are showing signs of steeper declines.
"In general, we think a lot of these commodity-exposed stocks will continue to find pressure because of falling commodity prices," Wald, chief market technician at Oppenheimer, said in the same "Trading Nation" segment.
He noted that while the SLX is coming off of a 52-week low, the trend is still quite negative. "We see resistance at $29," Wald said. "I think we get back down to the lows at around $23 a share."